In this FIRCA application, we propose to extend a parent grant that investigates the effect of a unique poverty alleviation program called PROGRESA on child health and development in Mexico. The proposed extension is to investigate the impact of economic development and poverty reduction on adolescent risk behavior. Specifically, we will evaluate the impact of PROGRESA on drug, alcohol and tobacco use, and on sexual practices. Since PROGRESA increases household income and provides financial incentives for children to stay in school, we will be in fact testing the hypothesis that improving the education and living conditions of adolescents in extremely poor households reduces risky behaviors. We hypothesize that improved education and living conditions will reduce adolescent alcohol, tobacco and drug use, and will reduce sexual practices leading to unwanted pregnancies and sexually transmitted diseases. Our analysis will take advantage of a randomized controlled design. In 1998, 506 PROGRESA villages were randomly assigned to control and treatment groups. Eligible households in treatment villages received benefits immediately, while benefits for eligible households in control villages were postponed until after the year 2000. A pre-intervention baseline survey of approximately 15,000 households with over 80,000 individuals and five follow-up surveys (at six month intervals) of the same households were conducted over the two-year experimental period. Under the parent grant, we are conducting a follow-up survey of the same households in 2003. This follow-up survey will be three years after the experiment ended and it will include measures of health status and measures of cognitive development. In this project, we propose to test the adolescent risk hypotheses by adding an adolescent risk behavior module to the 2003 survey funded by the parent grant. Therefore, this proposal is related to the parent grant through a common survey and taking advantage of the PROGRESA intervention to study the impact of poverty alleviation on individual health and welfare.